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Implementing total quality management with a focus on enhancing customer satisfaction
Satish Mehra and Sampath Ranganathan
Fogelman College of Business and Economics, The University of Memphis, Memphis, Tennessee, USA
Purpose – Aims to examine the role of total quality management (TQM) towards enhancing customer satisfaction. Design/methodology/approach – Using meta-analysis, existing research studies on TQM and customer satisfaction were quantiﬁed, summarized, and tested for moderators to clarify TQM impact. Findings – It is found that TQM substantially increases customer satisfaction across diverse industrial and cultural settings. Originality/value – This research broadens the scope of TQM applicability across varied industrial and cultural settings to achieve higher customer focus, increased customer satisfaction, and stresses the need for more meta-analytic studies on the subject. Keywords Total quality management, Customer satisfaction Paper type Research paper
Total quality management
Received November 2007 Revised May 2008 Accepted May 2008
1. Introduction Stressing the importance of product quality, some have suggested that improvement of service and tangible product quality is the single most critical challenge facing US businesses (Zeithaml et al, 1990). Improving quality is no longer considered as the duty of the manufacturing department, it is everybody’s job in the organization. Quality improvement must become a philosophy as well as a way of life. One movement which stressed this view point was total quality management (TQM). TQM is deﬁned as an organization-wide philosophy requiring all employees at every level of an organization to focus his/her efforts to help improve each business activity of the organization (Mehra et al, 2001). Compared to the result-oriented quality programs of the past, TQM is process oriented. Much of the quality literature in 1990s discussed about how Japanese ﬁrms used TQM to improve their competitive positions, and how it inﬂuenced other businesses followed them (Yavas, 1995). Emphasizing TQM both as a process and a philosophy, previous writers state that:
[. . .] the people in the organization are required to make quality a culture in their daily lives. Furthermore, it is also important to understand that TQM is a long-term perpetual improvement process requiring signiﬁcant resources, both ﬁnancial and human. It is a dynamic process – not a static one. It is a continuous effort with no deadlines or target dates. The process can never be considered complete since there is no goal or destination; hence, TQM becomes a way of life (Mehra et al., 2001, p. 856).
Even though the popularity of TQM grew, sceptics started questioning the usefulness of TQM. Many Japanese ﬁrms which successfully implemented TQM failed when the
International Journal of Quality & Reliability Management Vol. 25 No. 9, 2008 pp. 913-927 q Emerald Group Publishing Limited 0265-671X DOI 10.1108/02656710810908070
Japanese economy went on a long recession in 1990s. Dawson (1995) said that TQM is excessively dependent on Japanese culture and cannot be successfully implemented in individualistic cultures like the USA. Other scholars argue that TQM is not adaptable to dynamic situations in the current business environment (Dooley and Flor, 1998). However, Hoover (1995) says that management expects too much, and too soon from adapting TQM. He cautions against the overselling of TQM as the panacea for all problems that plague a ﬁrm. Therefore, instead of claiming that TQM has failed management, one can argue that management has failed TQM. As debate on the impact of TQM continued, research on TQM increased dramatically in 1990s (Filippini, 1997). In spite of the increase in research on TQM, many questions remain unanswered. For instance, various components of TQM must be explored, and the impact of TQM on organizational performance must be analyzed (Filippini, 1997). Mehra et al. (2001) conducted a literature review on TQM and suggested that businesses implementing TQM should focus on ﬁve elements. These elements are human resources (HRs), management structure, quality tools, supplier support, and customer orientation. After summarizing the literature on TQM, Mehra et al. (2001) concluded that the organizational emphasis in future will shift towards following four main areas for quality improvement: (1) customer focus; (2) process focus; (3) innovation focus; and (4) environmental focus. Mehra et al. (2001) particularly stressed the importance of customer focus and said that TQM itself is customer oriented. Authors emphasized the importance of the elements of customer loyalty and customer satisfaction in the area of customer focus. Stressing the need for using TQM to enhance customer focus, these authors stated that businesses must shift their focus toward customer satisfaction. Given that customer focus is heavily mentioned in the literature, Mehra et al. (2001) proposed that TQM of the future should be redeﬁned to include customer focus. Hence, one can understand that TQM by deﬁnition is a customer-oriented philosophy, and customer focus is expected to occupy a predominant place in the future of TQM literature. These arguments ﬁnd support from various scholars. For instance, Chien et al. (2002) say that for a ﬁrm attempting to implement TQM, customer satisfaction is an important objective to achieve. They argue that the level of customer satisfaction achieved is closely related to a company’s TQM practices, and it affects a company’s performance. In a later study on quality management, Kaynak (2003) suggested further research is necessary on the relationship between TQM and customer relations/satisfaction. Hence, it is plausible that customer-focused organizations need catalytic agents like TQM to enhance customer focus and their performance. 2. Objectives of the study Based upon the above stated arguments, we believe that studying the impact of TQM on the four focus areas mentioned by Mehra et al. (2001) will ensure enhanced organizational performance. However, studying the impact of TQM on all the focus areas and elements is way beyond the scope of any one study. Therefore, in our present
study, we attempt to investigate the impact of TQM on one single focus area; customer focus. To achieve our objectives, we use meta-analysis to identify potential moderators of the relationship between TQM and performance through customer satisfaction. First, let us present ﬁndings of our literature survey on TQM and customer satisfaction. 3. Related literature 3.1 History of TQM As early as 1979, Crosby (1979) deﬁned 14 steps for quality improvement. His work ﬁnds support in the writings of Ishikawa (1976, 1985) who emphasized the importance of training, problem solving, and quality circles as a method to achieve continuous improvement. Deming (1986), in his landmark work, Out of the Crisis, divulged the 14 principles that formed the basis of TQM. Juran (1986) identiﬁed the three basic functions of a quality management process: planning, organization, and control as the stages for quality improvement programs. For successful quality improvement, Feigenbaum (1991) stressed the need of leadership, a commitment to incorporate quality in the organization’s practices, and the participation of the entire workforce. These advocates of quality management studied the philosophical underpinnings of TQM and suggested various approaches to quality management. Both 1980s and 1990s witnessed the emergence of Japanese company wide quality control programs like Deming prize, Malcolm Baldrige, Australian and European quality awards, ISO 9000 series of quality standards, and QS-9000 based quality systems. Many organizations around the world followed these quality approaches and improved the quality of their products, services, and operational performance measures (Chin et al., 2003). Following the global trend, TQM became the quality buzzword in the USA during 1980s. Businesses all over USA tried to implement the Deming and/or Juran principles of quality in their ﬁrms. Many ﬁrms adopted TQM in their operations and saved millions of dollars (Goldman, 2005). From its inception, TQM was customer oriented. Goldman (2005) noted that the customers’ needs should be fully integrated into the design and development of products and services. However, doing so demands that the customer should be treated as an equal partner in the product’s life cycle. Hence, it is not surprising that TQM and marketing literatures have given much emphasis to customer satisfaction. 3.2 TQM and customer orientation Customers have expectations from an organization which they patronize. If those expectations are not met, they get dissatisﬁed, and stop patronizing the organization. Whether it is a restaurant or a church or a hospital, if it fails to meet the expectations of its customers then it cannot retain him/her. Hence, maybe due to this reason, marketing literature gives paramount importance to customer satisfaction. Studying the proﬁtability of 472 restaurants, Bernhardt et al. (1994) reported that customer satisfaction data collected at any point in time were directly related to restaurant proﬁts nine months later. Similarly, studying a diverse group of ﬁrms, Anderson et al. (1993) reported that customer perceptions of quality were positively related to return on investment. Eklof and Westlund (1998) points out to the fact that customer satisfaction is effective in quality management and it has the most important role while implementing TQM. Geyskens et al. (1999) view customer satisfaction as an important
Total quality management
antecedent variable for developing long-term marketer – customer relationships. Hence, organizations which want to build a loyal customer base with strong relational foundation cannot ignore customer satisfaction. They have to strive hard to satisfy their customers in order to retain them. Corporations of the past did not pay much attention to customer satisfaction. Now, due to lower sales and product maturity, they are turning around to stabilize existing customers to ensure their market shares. They have now realized that customer satisfaction will increase customer loyalty, which in turn improves proﬁts (Bruhn and Grund, 2000). Anderson and Fornell (2000) argue that customer satisfaction will lower the chance of customers being driven away due to the poor quality of products or services. Agus et al. (2000) argue that implementing TQM strengthens a company’s customer satisfaction and improves its ﬁnancial performance. Naumann et al. (2001) also point out that, for the next ten years, customer satisfaction would be the main focus of strategic planning by businesses. Due to customer satisfaction becoming one of the important judging factors in national quality awards, satisfying customers will play an important role in every corporation’s future growth. Firms which understand the signiﬁcance of customer satisfaction will reap rich rewards. 3.2.1 TQM in services. TQM concepts are widely used in health care industry to improve customer satisfaction. Ingram and Chung (1997) report that adopting TQM programs shifts moderately satisﬁed customers of health care organizations into maximally satisﬁed customers. Hasin et al. (2001) indicates that hospitals in Thailand use TQM because health care industry in Thailand has become very competitive. Authors further suggest that customer satisfaction is an enormously important ingredient of TQM. Endorsing this view, Aghazadeh (2002) says that TQM has now only begun to take precedence in American companies, and since health care is an industry where individualized care and attention is needed, TQM is absolutely important for businesses. 3.2.2 TQM in manufacturing. TQM’s impact on manufacturing sector was also studied by many scholars. Terziovski and Samson (1999) studied the impact of TQM programs on organizational performance of manufacturing industries in Australia. They reported that a typical manufacturing organization is more likely to achieve successes in employee relations, customer satisfaction, and business performance with TQM. Supporting their view, Agus et al. (2000) reported that TQM programs are widely used by manufacturing companies in Malaysia to enhance their ﬁnancial performance. Furthermore, Agus et al. (2000) indicate that the impact of TQM on ﬁnancial performance is mediated by customer satisfaction. Thus, an organization which implements TQM will have high customer satisfaction leading to improved ﬁnancial performance. Examining additional literature on TQM and customer satisfaction, we ﬁnd numerous arguments that suggest using a TQM program enhances customer satisfaction. Given that customer satisfaction is important, is TQM an effective method to attain customer satisfaction? What is the magnitude of relationship between TQM and customer satisfaction? Does the relationship between TQM and customer satisfaction affected by the culture of a nation or by the industry type? These questions remain unanswered, and hence, they are the main reasoning of our current research. Speciﬁcally, following research questions (RQs) will be the focal point of this study:
RQ1. What is the nature of the relationship between TQM and customer satisfaction? RQ2. Do culture and industry types (manufacturing versus service) mediate the relationship between TQM and customer satisfaction? RQ3. What is the nature of the relationship between TQM and customer focus? With this background on the literature and RQs, ﬁrst, let us justify the formulation of propositions for this study.
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4. Study propositions Many researchers have studied the impact of TQM practices on customer satisfaction. TQM is used by a wide range of service and manufacturing industries to increase customer satisfaction. American Express started using TQM processes as a pilot in one of its Dutch subsidiary in 1990s, and based on its success, company expanded the program internationally. As a result, recognizing the importance of customer satisfaction, American Express recovered its top position and went far ahead of its competitors by using the American Express quality leadership (AEQL) framework (Vendrig, 1996). Al-Saggaf (1997) conducted a case study on the impact of TQM initiatives on improving customer satisfaction in the electric service industry in Saudi Arabia and reported that such initiatives increase customer satisfaction, reduces cycle time, and minimizes total cost. Kanji et al. (1999) report that even though UK universities are slow to adopt TQM, those universities which followed TQM philosophy found enhanced student performance and customer satisfaction. These studies lead us to believe that implementation of TQM in an organization can result in increased customer satisfaction, and hence, we propose a direct positive relationship between TQM and customer satisfaction and posit P1 as follows: P1. A TQM program has a direct positive impact on customer satisfaction.
Scholars like Dawson (1995) and Dooley and Flor (1998) argue about the effectiveness of TQM. Dawson (1995) argues that TQM will not work in individualistic cultures like that of the USA. Reﬂecting on the adoption of TQM in western companies, Dawson (1995) writes that the substance of quality initiatives will vary across nations and businesses due to cultural differences. Author cites studies which show how important it is to view TQM as a well-deﬁned Japanese technique not transferable for universal adoption. He calls for studies that examine TQM in its cultural, social, and political context. Dooley and Flor (1998) also doubt the effectiveness of TQM by saying that TQM is not suited for a multicultural business environment. Some researchers have raised concerns about the effectiveness of TQM in service industries. They argue that service companies cannot measure quality costs because their products are intangible, perishable, and consumed at the point of delivery. Hence, service organizations providing intangible services are sceptical about TQM techniques and its adoption cost. In an interview conducted among managers of service ﬁrms by Elmuti and Kathawala (1999), almost 40 percent of the respondents indicated that TQM initiatives failed to improve the quality of services and productivity in their organizations. Major reasons cited for such failures were the
unique characteristics of services, and implementation of TQM practices without a full understanding of this philosophy. Studying the implementation of TQM in the UK banks, Cowling and Newman (1995) found that the banks failed to commit their employees to follow quality initiatives. Authors cited hierarchical structures, bureaucratic procedures, and paternalistic employment practices as the major reason for TQM failure. Adding to problems is the fact that there exists a perennial problem of overcoming the suspicion that exists between corporate ofﬁce and various branches. Other researchers (Beaver, 1994; Jauch and Orwig, 1994) also argue that TQM will not be effective in a service setting because of the unique characteristics of services. Since, questions are raised about the effectiveness of TQM across cultures and industry settings (service versus manufacturing), we decided to test for moderators based upon type of industry and individualistic versus collectivistic cultures by positing propositions P2 and P3 as follows: P2. P3. The impact of a TQM program on customer satisfaction will be same across individualistic and collectivistic cultures. The impact of a TQM program on customer satisfaction will be same across service and manufacturing businesses.
Stressing the need for TQM programs to have customer focus as its main goal, Tsang and Antony (2001) write that understanding, satisfying, and surpassing customer needs should be one of the main goals of implementing TQM programs. Also, as per these authors, employees should be customer focused. Along similar lines, Dean and Bowen (1994) argue that customer focus should be a key TQM ideal. Summing up the literature on TQM, Mehra et al. (2001) propose that TQM of the future should be redeﬁned to include customer focus, and in a later study, Kaynak (2003) also suggested further research on implementing TQM and customer relations. Hence, we argue that a successfully implemented TQM program would increase customer focus, and state the fourth proposition as follows: P4. Implementing TQM program increases customer focus in organizations.
5. Methodology Objective of this research is to study the impact of implementing TQM programs on customer satisfaction across varied businesses in different cultures. Towards this objective, we undertook a meta-analysis of the existing research studies on TQM and its link to customer satisfaction. Meta-analysis is the statistical analysis of a large collection of analyzed results from various individual studies for the purpose of integrating the ﬁndings (Glass, 1976). Meta-analysis represents key study ﬁndings in a sophisticated manner, and it is capable of ﬁnding effects (or relationships) that are obscured in other forms of research, and furthermore, it provides an organized way of handling information from a large number of studies under review (Lipsey and Wilson, 2001). In meta-analysis, existing literature is searched for studies that are relevant to the nature of a speciﬁc enquiry. Studies which quantify a numerical relationship between the dependent and independent variable form the basis for subsequent analysis. Once the study database is formed, the next step is to convert each individual study statistic to a common metric for later analysis.
The ﬁrst step in any meta-analysis is to search extensively for relevant studies. For this research, we searched for studies which had TQM as the independent variable, and customer satisfaction as the dependent variable. Search was conducted by using Boolean expression – TQM and customer satisfaction. A keyword search in prominent databases, ABI-Inform global and EBSCOhost, yielded 361 and 255 studies, respectively. We carefully scrutinized these studies, one by one, and identiﬁed speciﬁc empirical articles of interest to this research. Articles which reported a direct relationship between TQM and customer satisfaction as correlation coefﬁcients were the only ones selected. In the end, we were surprised by the lack of empirical studies that have researched the relationship between TQM and customer satisfaction. This is in line with observations of Yasin et al. (2004, p. 45) who said:
The bulk of the literature appears to support the notion that there exists a positive relationship between quality improvement efforts and the various facets of organizational performance such as operational efﬁciency, customer satisfaction, ﬁnancial performance, and even competitive advantage. However, empirical research addressing the relationship of quality improvement efforts and its impact on organizational performance is slow in forthcoming.
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We hope that the research conducted in this study will ﬁll this void. 6. Research analysis 6.1 TQM and customer satisfaction Utilizing the selected research studies, we started converting all statistics of relationship to effect size. Cooper (1998) calls an effect size as a statistic that measures the magnitude of relationship (or relationship strength) between two variables. A correlation is the most appropriate metric for expressing an effect size when we describe the relationships between two continuous variables (Cooper, 1998). Since, the studies included in the analysis measured TQM and customer satisfaction as continuous variables, we used the correlation coefﬁcient as the effect size. Additionally “study” was used as the unit of analysis (Hunter and Schmidt, 1990) and within-study correlations were averaged to derive the overall relationship for each study. We extracted 74 correlations between independent and dependent variables from eight studies. Within each study, correlations were averaged to derive a single correlation coefﬁcient for that study. In studies that reported correlations between different components of TQM and customer satisfaction, such correlations were averaged, and a single correlation coefﬁcient for each study was derived. We then converted these correlation coefﬁcients into Fisher’s Z-value to test our research propositions. It needs mentioning that the total size of respondents from all studies used in our present analysis is 3,411. We coded the study for moderators. Given the number of studies, and the fact that the moderating characteristics were objective (service versus manufacturing, collective versus individualistic cultures), coding was agreeable among authors (a pre-requisite for meta-analysis). While coding for national cultures, we used the east-west classiﬁcation used by scholars like Ralston et al. (1997). Eastern countries are high on collectivism and western countries are high on individualism (Ralston et al., 1997). Thus, studies from Asian countries were coded as collectivistic while European and the US studies were coded as individualistic. This coded data is shown in Table I.
The Z-scores were in a range of 0.16-0.74. Mean and median values were 0.42 and 0.43, respectively, with a standard deviation of 0.215. In essence, the average effect size between customer satisfaction and TQM is 0.42. This effect size of 0.42 can be labeled as small to medium (Lipsey and Wilson, 2001), implying that implementing a TQM program does impact customer satisfaction. A one sample t-test was conducted to ﬁnd out whether the relationship between independent and dependent variables were different from zero. The argument that the relationship between TQM and customer satisfaction is non-existent was rejected (t ¼ 5.58, P , 0.01). The 95 percent conﬁdence interval for Fisher’s Z score was 0.24-0.60. If the 95 percent conﬁdence limit does not contain zero, then the proposition of no relationship between dependent and independent variable can be rejected (Cooper, 1998). Hence, we conclude that proposition P1 (which proposes a direct relationship between TQM and customer satisfaction) is valid. We conducted a t-test for equality of means. We failed to reject the notion that individualistic and collectivistic cultures moderate the relationship between TQM and customer satisfaction. (F ¼ 0.095, P ¼ 0.768). Hence, P2 is also valid. Next we tested for the moderation on type of industries. We failed to reject the argument that service versus manufacturing industries distinction moderates the relationship between TQM and customer satisfaction. (F ¼ 1.638, P ¼ 0.248). Thus, P3 is a valid study proposition. Related analysis is presented in Table II. 6.2 TQM and customer focus We repeated the same process for the dependent variable customer focus. A search in ABI-Inform database with key words TQM and customer focus yielded 68 studies. A similar search in Business Source Premier yielded 44 studies. We analyzed these studies (one by one) to locate those empirical studies which reported correlations between TQM and customer focus. For this research, meta-analysis was conducted
Study Agus (2004)) Agus et al. (2000) Ruggieri and Merli (1998) Ingram and Chung (1999) Wong (2002) Claver et al. (2003) Sakthivel et al (2005) Yang (2006) Continent Asia Asia Europe USA Asia Europe Asia Asia Industry Service Manufacturing Service Service Manufacturing Manufacturing Service Manufacturing Fisher’s Z 0.161 0.255 0.536 0.632 0.53 0.202 0.74 0.319
Table I. Coding sheet: customer satisfaction
Study Tsang and Antony (2001) Morrow (1997) Dow et al. (1999) Agus et al. (2000) Terziovski (2006)
Continent Europe USA Australia Asia Australia
Industry Service Service MFG MFG MFG
Fisher’s Z 0.6931 0.3769 0.2877 0.5101 0.2661
Table II. Coding sheet: customer focus
using “study” as a unit of analysis (Hunter and Schmidt, 1990). Hence, within-study correlations were averaged to derive the overall relationship for each study. As a result, 34 correlations between independent variable and dependent variable from these studies were obtained. Correlations within each study were averaged, and a single correlation coefﬁcient for each study was derived. These correlations were then converted into Fisher’s Z value for checking the validity of fourth proposition. It needs mentioning that the total size of respondents from all studies used in our analysis was 4,387. The Z-scores were in a range of 0.26-0.69. Mean was 0.42, and median was 0.37, and standard deviation was 0.17. In essence, the average effect size between customer focus and TQM is 0.42. The effect size of 0.42 can be called as small to medium (Lipsey and Wilson, 2001), implying that implementing a TQM program impacts organization’s focus on customers. A one sample t-test was conducted to ﬁnd out whether the relationship between independent and dependent variables was different from zero. The argument that the relationship between TQM and customer focus is zero was rejected (t ¼ 5.387, P , 0.01). The 95 percent conﬁdence interval for Fisher’s Z score was 0.20-0.64. If the 95 percent conﬁdence limit does not contain zero, then the basis of no relationship between dependent and independent variable can be rejected (Cooper, 1998). Hence, P4 is also a valid proposition. Supporting analysis is shown in Table III. 7. Research ﬁndings and their contributions Our research highlights the importance of analyzing the impact of TQM practices on organizational performance. As suggested by various recent researchers (Kaynak, 2003; Mehra et al., 2001), this research was also an attempt on quantifying the relationship between TQM, customer focus, and customer satisfaction. Through the use of meta-analysis, we found that implementing TQM programs in an organization directly and positively impacts customer satisfaction, and most importantly, this relationship is invariant across types of industries and cultures. This leads us to conclude that there is no merit arguing that TQM programs can be successful only in collectivistic cultures. Furthermore, our study ﬁnds TQM ideals to be equally effective in service ﬁrms as well as manufacturing ﬁrms. Thus, TQM practices can impact customer satisfaction uniformly across varied cultures and different industry types. Organizations that successfully implement TQM will beneﬁt from increased customer satisfaction. Additionally, our meta-analysis based research ﬁnds that successfully adopted TQM programs have a solid grounding in customer focus. This provides strong support for the arguments of Mehra et al. (2001) who stressed the importance of customer focus in designing of TQM programs. This study indicates that ﬁrms must treat customer focus as a core component of TQM practices in their journey towards
Variables TQM-SAT TQM-customer focus N 3411 4387 Mean 0.42 0.42 Median 0.43 0.37 SD 0.215 0.17 95 percent CI 0.24-0.60 0.20 to 0.64 Effect size Medium Medium
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Notes: SAT, customer satisfaction; N, sample size; SD, standard deviation; 95 percent CI, 95 percent conﬁdence interval for mean
Table III. Descriptive statistics
effectively building a customer-focused organization. In this regard, our paper addresses to the need for research between TQM implementation and customer relations as proposed by previous writers (Kaynak, 2003; Hendricks and Singhal, 1997). Furthermore, based on our meta-analytic research, we propose a working deﬁnition for TQM as follows:
TQM is a management strategy that, with sound design and successful implementation, can be adopted to enhance customer satisfaction through a concerted focus on customers. Furthermore, this strategy is equally applicable to both manufacturing and service businesses operating in varied global cultures.
8. Managerial implications research ﬁndings In order to ascertain real world contributions (value) of our ﬁndings, we formed a focus group of four senior quality managers, each with a minimum of ten years of quality management experience in manufacturing and service sectors. Our objective was two-fold; ﬁrst, to seek afﬁrmation of our ﬁndings about TQM and customer satisfaction, and second, to reﬁne the ﬁndings (as needed) in order to develop some guidelines for future managerial actions. Towards the ﬁrst objective, we shared the detailed study conclusions with each focus group member individually to get their feedback on the real world applicability of our ﬁndings. Except for minor comments and clariﬁcations, panel members were in agreement with the research conclusions. Additionally, each member provided us with their own views on the design and use of TQM programs towards enhancing customer satisfaction. These views are discussed next. First and foremost, businesses must become highly effective through understanding their customers’ needs. This will require that speciﬁc skills be imparted to the organizational workforce. Such HR skills should be customized for each business depending upon its products and services as well as its unique market dynamics. Second, due to the global nature of the markets, necessary multicultural training becomes a must for all business personnel to effectively understand both the customers and the competition. Third, businesses must prepare their employees in gauging a customer’s experience using speciﬁc assessment criterion in a timely manner. In view of these arguments, following three-step managerial action plan can assist organizational efforts to enhance performance: (1) Develop customized skills in the workforce for understanding customer needs at critical customer contact points. (2) Impart multicultural training to speciﬁc employees for understanding both the global customers and the world-wide competition. (3) Train relevant personnel in assessing customer experience (satisfaction level) at the right time throughout the sensitive and major contact points. Based on our study ﬁndings, and with the feedback from focus group members, we propose a conceptual model for adopting TQM practices in businesses. It is shown in Figure 1 and discussed next. 9. Model justiﬁcation and future research In our model, we argue that the aforementioned points be carefully considered in designing a TQM program to achieve customer focus. Through reverse feedback,
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Figure 1. Conceptual model of TQM implementation and its impact on organizational performance
customer focus can facilitate future enhancements towards designing customized quality programs for a business. This is not to say that one ignore the traditional elements of a TQM system design; our arguments should be considered supplemental to the traditional design process. Such a quality program, when successfully implemented, will increase customer awareness in the organization leading to higher satisfaction and enhanced organizational performance. Additionally, the quality program may provide a basis for future improvements and/or innovations for various departmental units in a business by becoming more of a customer-focused unit. It is hoped that future researchers will examine the validity of our proposed conceptual model through challenging its assumptions. We propose that TQM programs be looked upon as an effective way of building customer-focused organizations. We also suggest that future studies examine the relationship between customer-focused TQM programs and increases in customer satisfaction among business clientele. This may clarify whether employees in a business should be extensively trained (in speciﬁc quality tools) with a focus on understanding and satisfying customer needs and wants. Certain recent studies (Kaynak, 2003; Mehra et al., 2001) strongly recommended that future research examine the relationship between quality management practices and their impact on various elements of organizational performance such as customer satisfaction. It is hoped that our research has ﬁlled this gap and it has also provided guidelines for future research. 10. Conclusions This research was an attempt to answer key questions on the relationship between implementing TQM programs and the customer side of a business, speciﬁcally customer satisfaction and customer focus. Based on our ﬁndings, we conclude that successfully adopted quality management practices positively impact customer satisfaction level. Additionally, organizational focus on customers also increases resulting in enhanced business performance. Through our interaction with practicing managers, this paper also proposed a working deﬁnition of TQM and provided a set of
guidelines for managers to implement TQM practices in both the manufacturing and the service businesses. Every study has limitations, and this one is no exception. Unfortunately, studies reporting relationship between quality improvement efforts and organizational performance are slow in forthcoming (Yasin et al., 2004). Hence, our study sample size was limited. Even though our research study compares favorably with other studies (Davis and Rothstein, 2006), we hope that in future more studies may be available for inclusion in the meta-analysis. It is strongly suggested that future researchers report correlation measures in their studies, enabling theory building meta-analytic research on the other TQM focus areas (process focus, innovation focus, and environmental focus) that could not be covered in this paper.
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